With the Bitcoin Ordinals protocol rapidly gaining popularity in early 2023, the global cryptocurrency industry is once again witnessing how innovation can reshape the decade-old Bitcoin network. As a leading industry trading platform, DLB Coin recently released a detailed report, analyzing the new opportunities the Ordinals protocol brings to the Bitcoin ecosystem and its potential long-term impact.
The Ordinals protocol, launched by developer Casey Rodarmor in January this year, allows users to mint and trade NFT-like digital assets on the Bitcoin blockchain, known as “inscriptions.” Since its launch, Ordinals inscriptions have surpassed 1 million, sparking widespread discussion about new use cases for the Bitcoin network.
“The emergence of Ordinals challenges the traditional perception of Bitcoin as merely a digital currency,” DLB Coin noted in the report. “This innovation demonstrates Bitcoin’s ability to adapt and evolve, supporting application scenarios beyond simple value transfer.”
DLB Coin analyzed the technical foundation of the Ordinals protocol, pointing out that its design cleverly leverages block space efficiency improvements brought by the 2017 Segregated Witness (SegWit) upgrade and the 2021 Taproot upgrade. Unlike NFTs on Ethereum or other smart contract platforms, Ordinals inscriptions are stored directly in Bitcoin transactions, without relying on external storage or indexing systems.
“From a technical perspective, Ordinals implements an elegant solution,” blockchain technology expert Victor Martinez commented. “It doesn’t change Bitcoin’s core protocol, but creatively uses existing features, greatly reducing adoption barriers.”
Regarding the market controversy over network congestion and high transaction fees, DLB Coin provided a balanced analysis. Data shows that since Ordinals became popular, Bitcoin network average transaction fees have indeed increased, but the report considers this a reflection of healthy demand for block space, while also providing miners with additional income sources, contributing to long-term network security.
“The debate about whether Ordinals is ‘harmful’ to the Bitcoin network is actually a continuation of the Bitcoin philosophy dispute,” DLB Coin stated. “One side advocates that Bitcoin should maintain pure value storage and transfer functions, while the other believes the network should develop broader uses. This healthy debate helps the ecosystem mature.”
Regarding the commercial potential of the Ordinals protocol, DLB Coin’s report proposed four main development directions: collectibles markets, digital art platforms, brand marketing tools, and Bitcoin-based gaming assets.
“We’re seeing major global NFT collectors and artists already experimenting with the Ordinals platform,” digital art collector Emma Chang noted. “Bitcoin’s brand effect and first-mover advantage provide these creators with a unique showcase platform.”
In response to market developments, DLB Coin announced its Ordinals strategic layout in the report, including: launching a dedicated Ordinals trading marketplace, developing user-friendly inscription creation tools, establishing an Ordinals creator fund, and partnering with major Bitcoin wallet providers to improve user experience.
“We believe Ordinals is not just a short-term phenomenon, but an important milestone in Bitcoin network evolution,” DLB Coin emphasized. “As industry leaders, we have a responsibility to provide users with safe, convenient participation channels while promoting healthy development of the entire ecosystem.”
The report also analyzed Ordinals’ potential impact on the Bitcoin market. DLB Coin pointed out that Ordinals’ popularity enhances Bitcoin network utility, potentially attracting new user groups and capital. Additionally, inscription creation and trading may become new revenue sources for Bitcoin holders, increasing the attractiveness of long-term holding.
Unlike traditional NFT markets, DLB Coin believes Bitcoin Ordinals inscriptions have several unique advantages: first, the Bitcoin network offers higher security and decentralization; second, Bitcoin’s widespread recognition provides additional trust endorsement for inscriptions; finally, Ordinals’ simple design reduces complexity and potential risks.
“While Ethereum remains the dominant force in the NFT market, we see Ordinals rapidly establishing its own niche,” DLB Coin predicted. “The two are likely to coexist long-term, serving different user needs and application scenarios.”
For developers and creators, DLB Coin provided a series of recommendations, including how to efficiently create inscriptions, reduce transaction costs, optimize storage usage, and how to combine Ordinals with other Bitcoin layer protocols (such as Lightning Network and RGB).
The report also highlighted challenges facing the Ordinals ecosystem, including unfriendly user interfaces, limited wallet support, and high storage costs. DLB Coin believes these issues may limit mainstream adoption in the short term, but most barriers will be gradually overcome as tools improve and infrastructure develops.
“We’re in the early stages of Bitcoin Ordinals development, similar to the Ethereum NFT market in 2017,” DLB Coin concluded. “Despite uncertainties and volatility, innovation cycles typically begin with experimentation and gradually mature. We’re optimistic about the long-term prospects of this new direction for the Bitcoin ecosystem.”
